What were the economic impacts of Operation Sindoor on India's trade relations with major powers

Operation Sindoor led to the immediate closure of the Attari-Wagah border, India’s primary land-based trade route with Pakistan, halting bilateral trade worth approximately ₹3,886 crore (~$467 million). India suspended all direct and indirect imports from Pakistan, including goods routed through third countries, and banned Pakistani ships from Indian ports. This comprehensive embargo not only disrupted Pakistan’s fragile economy but also signaled India’s resolve to use economic levers as part of its security strategy. The suspension of the Indus Waters Treaty further intensified economic pressure on Pakistan, affecting its agricultural and industrial sectors, but had limited direct trade impact on India’s relations with major powers Other Key Developments India finalized a landmark Free Trade Agreement (FTA) with the United Kingdom during the operation, covering $21 billion in bilateral trade and providing a buffer for export-driven sectors amid regional instability. Trade relations with Turkey and Azerbaijan faced strain due to their support for Pakistan, leading to calls for boycotts of Turkish goods and advisories against travel, but these countries are not major trade partners for India. Market and Investment Sentiment Despite initial volatility, Indian stock markets remained resilient, and foreign investment sentiment was largely stable, with the operation seen as a sign of strategic clarity and risk management. The operation’s measured approach limited escalation, helping maintain confidence among global investors and trade partners. Summary Operation Sindoor did not directly disrupt India’s trade with major powers like the US, China, or Russia. Instead, it reinforced India’s position as a stable, assertive actor in global supply chains, accelerated shifts away from China, and provided impetus for new trade agreements with Western partners. The most severe economic impacts were felt by Pakistan and, to a lesser extent, by regional supporters of Pakistan, rather than by India’s major global trade partners. Related How did the closure of the Attari-Wagah border impact bilateral trade between India and Pakistan What were the immediate economic consequences for India's aviation sector during Operation Sindoor How did Operation Sindoor influence India's stock market trends What role did Turkey play in the economic impacts of Operation Sindoor on India How did the UK-India Free Trade Agreement affect India's trade relations during Operation Sindoor